Wednesday, November 3, 2010

Elections a gas for Marcellus drillers

Among the big winners in Pennsylvania last night: the Marcellus Shale gas-drilling industry.

Obviously, the most significant win for the industry is Tom Corbett's victory in the gubernatorial race. Corbett has, after all, pledged not to levy a severance tax on gas taken from beneath the state ... even though Pennsylvania would be the only major gas-drilling state without one, and even though the industry itself seems willing to accept one. With more than $835,000 from the industry, Corbett was also the #1 recipient of gas-drilling donations, blowing away Democrat Dan Onorato's comparatively meager $112,800.

In the state House, the industry's record was a slightly more mixed bag. All House seats were up for grabs this year, and of the 50 candidates who receieved at least $1,000 from the industry, I count three that appear to have lost: Philadelphia Republican John Perzel, who of course was caught up in an ethics scandal; Democrat John Pallone; and one of the night's big surprises -- Democrat Todd Eachus, the House majority leader.

Another race involving a recipient of Marcellus money, David Levdansky, is too close to call, though he appears to be trailling. Even that wouldn't really be a setback for the industry, though: Levdansky has pushed for an aggressive tax on shale gas.

Of course, there's no secret to the industry's success. It bet heavily on incumbents, and while some races were competitive -- like Democrat Tim Solobay's succcesful bid for an open seat in the 46th Senate district -- many of its choices were facing no opposition at all. (And not everyone who took a few bucks from the industry is in its back pocket: Consider Levdansky, or state Senator Jim Ferlo, whose $1,050 in contributions from the industry hasn't exactly muted his criticism of it.)

I still think it's possible that we'll see some form of tax, despite Corbett's pledges. The state is facing billion-dollar deficits, and I'm not sure where else the money is coming from. But if a tax does happen, it's clearly going to be on terms of the industry's choosing: You could probably expect lower tax rates in the early years of a well's operation -- when most of the gas will be taken out -- and a "forced pooling" provision as well.

But the bottom line remains: It's not just Democrats who should feel the ground moving beneath their feet this morning.

You'll have a chance to make some noise about it, though: This afternoon, environmental activists will be holding a gas-drilling protest outside an industry convention at the David Lawrence Convention Center, Downtown.